Dow Jones Industrial Average futures were off 18 points in screen trade.

Escalating turmoil in the Middle East hit several markets in the region, but many had managed to pare morning losses. Oil prices remained up after spiking in early trade amid reports of gunfire in the Libyan capital Tripoli and several quarters of the city.

March Nymex crude oil futures were up $1.03 at $87.23 per barrel on Globex. Safe-haven flows also sent spot gold higher, which was recently at $1,394.70 per troy ounce, up $5.60 from its New York close Friday.

"There is a bit of nervousness as violence in the Middle East and around is continuing to get worse and investors are just starting to get worried about that side of the world," said Hamilton Hindin Greene broker Grant Williamson in New Zealand.

In Tokyo, oil-linked stocks rose on the back of the crude oil price surge.

The mild gains in the Shanghai market, which came despite the second hike this year of banks' reserve requirement ratio from Beijing late Friday, also helped the Nikkei turn higher after its early slide.

Inpex rose 1.9% and Showa Shell Sekiyu advanced 3.4% on expectations that crude prices will continue to rise amid the unrest in the Middle East.

Softbank advanced 4.2%, helped by a report that China's Renren.com, a social networking site in which Softbank has invested, plans to list its shares in the U.S. this year.

Exporters were mixed, with Nissan Motor off 0.9%, Toyota Motor flat and Sony up 1.5%.

Shares in Shanghai were higher, but banks and property stocks in Hong Kong and on the mainland were down after Beijing's latest RRR hike.

GF Securities analyst Mu Hua said the hike will force banks to park more money with the central bank by cutting bond holdings, which will result in a lower net interest margin.

On the mainland, China Construction Bank fell 1.0%, China Merchants Bank was down 0.8% while property plays China Vanke and Poly Real Estate Group were down 1.1% and 1.3%, respectively.

In Hong Kong, China Resources Land was off 0.3%, Evergrande Real Estate fell 1.0% while mainland banks ICBC and Bank of Communications were down 0.2% and 0.4%, respectively.

Meanwhile, preliminary HSBC China Manufacturing Purchasing Managers Index, a gauge of nationwide manufacturing activity, fell to 51.5 in February from January's final PMI reading of 54.5.

The decline in the PMI to a seven-month low may help ease concerns about an overheating economy.

In Australia, the benchmark S&P/ASX 200 index fell to a six-day low at 4881.6. Resources stocks were leading the declines, with BHP Billiton off 1.7%, Rio Tinto down 1.7% and Fortescue off 2.8%.

"Resources are reacting negatively to China's latest reserve requirement increase," said Macquarie Private Wealth adviser James Rosenberg. "Instability in the Middle East is also a negative factor for equities. You don't know if it's on the cusp of significant conflict and massive change in the region."

Early focus in Sydney also turned to the sale by U.S. private equity firm Kohlberg Kravis Roberts & Co. of one of Australia's leading media firms through the A$4.1 billion sale of Seven Group to West Australian Newspapers Holdings Ltd.

West Australian shares were on a trading halt, while Seven advanced 1.4%.

Energy stocks were outperforming the market, with Santos rising 1.5% after crude oil prices rose amid the reports of gunfire in Libya.

Shares in Seoul were down amid falls in regional stocks and weakness in financial plays.

The financial sector was dented by the Financial Services Commission's recent decisions to halt operations of a total of six savings banks for six months; KB Financial fell 2.4% and Woori Finance was off 2.8%.

Shipbuilders were attracting buyer interest on order hopes after Daewoo Shipbuilding & Marine Engineering said Monday it has secured a KRW2 trillion contract to build 10 container ships for A.P. Moeller-Maersk AS, confirming a Dow Jones report Friday. Daewoo Shipbuilding was up 3.2% and Samsung Heavy Industries was 4.8% higher.

Elsewhere in the region, Taiwan's Taiex slipped 0.1%, Singapore's Straits Times Index was down 0.5%, Malaysia's Kuala Lumpur Composite Index was flat, Philippine shares fell 0.4%, Indonesia shares were down 0.2%, shares in Thailand was off 0.2%, and New Zealand's NZX-50 lost 0.9%.

In foreign exchange markets, the euro was a tad lower against the U.S. dollar after rising solidly on Friday after comments from ECB executive board member Lorenzo Bini Smaghi revived expectations of higher interest rates in the euro zone.

While Smaghi said the central bank must monitor rising price pressures more vigilantly, most market participants don't expect an imminent rate hike.

So far, unrest in the Middle East has had only a modest impact on the euro and other risk-sensitive currencies. However, a "further escalation in the current political tensions in the Middle East" would support the dollar through increased safe-haven demand, said Mike Jones, currency strategist at the Bank of New Zealand.

The single currency was fetching $1.3674 against the dollar, from $1.3695 late Friday in New York, and Y113.65 against the yen, from Y113.93. The dollar was at Y83.12, compared with Y83.14.

Lead March Japanese government bond futures were modestly lower after Friday's fall in U.S. Treasurys, but the losses were contained by worries over the Middle East turmoil and the Nikkei's weakness. The contract was down 0.02 at 139 points, while the 10-year cash yield was unchanged at 1.300%.

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